The Finances of Slave Life Insurance: Did Life Insurers Act Appropriately from a Financial Perspective?
An important part of having slaves as a labor force is insuring their lives and their income. This paper explores whether antebellum life insurance companies insuring slaves did so appropriately and/or responsibly from a financial perspective. Determining whether antebellum life insurance companies did so is essential, as life insurance is a major segment of the economy of most countries and hence it is vital that life insurers perform well and are viable for the benefit of other industries and national economies, including with respect to the antebellum United States. This is the first study to investigate several critical financial elements, including premiums, expenses and mortality, of antebellum life insurance companies regarding feasibility. One characteristic of the results is that if firms employed a suitable expense assumption then the premium did not have a high enough mortality assumption and vice-versa. Additionally, most premium increases used regarding hazardous occupations, sum insured limits and location failed to adequately account for the associated increased mortality. The overall result is that, from a financial perspective, antebellum life insurers had trouble accounting for slave life insurance appropriately and/or responsibly.
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